Getting a Taste of Fair Treatment with the New Credit Card Act
There has been a lot said everywhere about the new consumer protection laws for credit card users that have passed. Magazines and talk shows keep saying that the credit card companies and banks are up in arms over newly tightened regulations against any misconduct or unfairness that they used to get away with. Just the knowledge that the credit card companies hate the new credit card act is enough to lots of people, to be able to fall in love with the act even before they've actually seen it. Well, here's your chance to see it, and find out how good it actually is. The act itself is called the CARD Act, and it's been in effect ever since the last week of February. Let's get to know it better.
One of the most popular parts of the law, is the one that requires the banks give you notice a month and a half in advance when the plan on revised fees, rates and everything else. The banks now may lower your credit limit, and they don't need to give you any notice. You may think, if you don't know when your limit is taken down, how are you supposed to make sure you don't go overboard and get hit with a bunch of fees and interest for it? That's the beauty of it. The new credit card act makes sure the banks can't charge you for anything you spent over your limit, unless you actually asked to be allowed to spend over your limit.
Let's say that they do give you your 45-day notice; what about all the credit card dues that you racked up already? Are you going to be charged the new rate if you haven't paid it all back by then? Not so fast, says the new law. They can't charge you any new rates on old balances. And if you pay your bill by phone or over the Internet, they can't charge you for offering you that convenience either. Let's say, that you wish to close your account with a credit card company. Whatever balance you have left unpaid and that you borrowed before you knew you were going to close your account - can they make you pay up before they will allow you to close your account? It's surprising they even thought they could get away with this, but of course they can't.
And they are going to have to give you the terms you had when you actually had your credit card. You get to hold the balance that already exists, for as long as you would have been allowed, if you had the credit card. And if you can't repay it in time, they have to give you a repayment package, that at least gives you five years.
We have been so spoiled by free credit cards, that to go back to the bad old times when we had to pay an annual charge, would be difficult. But not for the credit card companies; they are contemplating breaking that idea out again big time. But so far, there isn't that much of an increase in the number of new credit card offers that demand an annual charge. If you're shopping for a new card, it may not make that much sense putting too much time into looking for a card that doesn't charge you an annual fee though. They just need to give you 45 days notice, before you they slap one of those on you.
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